NNPC And Chevron Sign EGTL Settlement Agreements, Highlight Socio-Economic Development of Nigeria
The recent Escravos Gas-To-Liquid (EGTL) Project Settlement Agreements entered into by the Nigeria National Petroleum Corporation (NNPC) and Chevron Nigeria Limited (CNL), Operator of the NNPC/Chevron Joint Venture is expected to boost Nigeria’s domestic gas utilization.
The Settlement agreements were signed at the NNPC Headquarters in Abuja on December 24, 2019 on behalf of the two companies by Mele Kyari, Group Managing Director of the NNPC and Monday Ovuede, Director of the NNPC/CNL Joint Venture, representing Jeffrey Ewing, Chairman/Managing Director of CNL.
Under the new agreement the EGTL interest will be aligned with the Joint Venture Upstream interest at NNPC 60%:CNL 40% with CNL as Operator of the asset.
Speaking at the Agreement signing ceremony, the NNPC Group Managing Director appreciated the NNPC and CNL teams and the Senate, that were involved in the resolution process, for the successful resolution of the EGTL project costs dispute.
He thanked the President of the Federal Republic of Nigeria for approving the resolution. He said the EGTL is an important asset that will see CNL supply an average of 400mmscf/day, equivalent of 26% total domestic gas supply, the highest by any IOC in the domestic market.
“In all, the EGTL will bring loads of benefit to the Nigerian economy as well as to CNL: energy supply, improved gas utilization, fiscal receipts and a renewed social license to operate”, he added
Speaking on behalf of CNL, Monday Ovuede said the executed agreements have resolved historical disagreements between NNPC and CNL related to the EGTL project and also signal the implementation of a new governance model.
Mr. Ovuede added that EGTL is part of an integrated gas development strategy, along with the Escravos Gas Project (EGP3). ‘EGTL together with EGP3 provides a reliable flares-out solution and remains a critical part of the overall NNPC/CNL Joint Venture gas commercialization strategy’, he explained.
He appreciated the management of NNPC, the Senate and other stakeholders that collaborated to achieve this important milestone. Mr. Ovuede expressed the commitment of CNL to the efficient and safe operation of the EGTL and the development of the Petroleum industry in Nigeria.
The EGTL plant, located in Escravos, in the Western Niger Delta started technical operations in 2014. It is designed to convert feed gas from the JV fields to high quality diesel and naphtha with a maximum output of 33,200 barrels per day.